When It Comes to Telemedicine, Medicare Has a Ways to Go

En español | Hundreds of thousands of people are going virtual to get their health care — replacing traditional face-to-face visits with telemedicine, or health services provided via telecommunication systems by health care professionals at a different location. Telemedicine has a variety of uses. For example, cardiologists can monitor the status of patients with heart disease miles away. Telemedicine can also help patients learn how to manage their illness at home, take their medications as prescribed by their clinicians and stay out of the hospital. Such services can help reduce health care costs, ease health care professional shortages and improve health care outcomes. But many Medicare beneficiaries are not eligible to receive telemedicine services.

Medicare Coverage of Telemedicine Is Limited

Unlike Medicaid and a growing number of private insurers, Medicare imposes tight restrictions on which telemedicine services qualify for reimbursement. Examples of the limited but slowly growing number of “connected health” services covered by Medicare include office visits, certain mental health services, and chronic disease care management.

In addition, even when telemedicine services technically qualify for coverage, Medicare will pay for such services only when beneficiaries live in a rural area or in an area with a shortage of health care professionals. Nor does Medicare necessarily pay for other patients who might benefit from telemedicine, such as homebound people who are too frail for a long trip to their clinician’s office or who do not have easy access to transportation.

Health Care Professionals Also Face Challenges

Like Medicare beneficiaries, health care professionals who want to use telemedicine face a number of obstacles. In addition to the start-up costs of obtaining the necessary technology, they must learn how to correctly operate such telecommunications systems before they can appropriately care for their patients. Further, clinicians must have a license to practice in their home state and also in their patients’ states — a costly and time-consuming requirement that leaves many wondering if it is worth the trouble.

What Does the Research Say?

A recent study of Medicare beneficiaries living in nursing homes found that residents who could consult a doctor via a telemedicine service had fewer hospital stays than residents with standard on-call physician coverage. This decrease in hospitalization rates saved Medicare an estimated $151,000 per nursing home per year. Other research shows that including telemedicine in the care management of chronically ill patients can lower Medicare beneficiaries’ mortality rates and reduce their number of hospital admissions. It can also save Medicare several hundreds of dollars per beneficiary per quarter.

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Claire Noel-Miller is a senior strategic policy adviser who focuses on a variety of health policy issues related to older adults, including Medicare beneficiaries' out-of-pocket costs, Medicare observation status and health care quality.